Parliamentary Panel recommends third-party audit of CSR spending
Standing committee on Finance of Lok Sabha has recommended the government for third party audit of Corporate Social Responsibility spending by companies. As per the recommendations, monitoring compliance of CSR norms is a difficult task, and information regarding such spending by companies is insufficient and difficult for a layperson to access.
Section 135 of the Companies Act, 2013 requires certain class of profitable companies to spend at least 2 per cent of their three-year annual average net profit towards CSR activities in a fiscal year on CSR activities as specified by the government. Since its inception, government has made several amendments to ensure effective implementation and reporting. As per the ministry, existing legal provisions provide adequate safeguards.
